Korelin Economics Report

Data and comments on Gold vs Fed rates, Insider Selling and Copper

Cory

Below I outline some interesting economic data and news that caught my eye. I am always interested in what all of you think so please feel free to share your thoughts on the charts and data below…

First up we have something that seems contradictory to what most investors are taught but has been the trend for gold when compared to the Fed’s key interest rate in 2004 and currently which started in December of 2015.

As rate increase gold should be dropping because of the argument that gold does not pay a dividend. This chart is a great example of the importance of looking past one metric. The Fed is behind the curve and even though it is raising rates gold is rising just as it did in 2004. A great example of history echoing itself.

Next up is some data on the US equity markets from TrimTabs. In February as the markets put in new all time highs we saw a drastic shift in what insiders are doing with their money. Here’s the quote from TrimTabs…

Insider Selling  explodes to six-year high in February.

Whenever insiders are selling this should make investors take note. In no way does this signify a major drop in the markets but it is a cause for concern.

 

The final note comes from a technical analysts and is focused on the copper chart. I said late last year that the run up in copper would slow and we would see a sideways consolidation of price. Too much of the move was predicated on Trump’s infrastructure spending which is taking much longer than those drinking the kool aid thought.

Chris Kimble points out that if cooper breaks point 2 (below) we could see some more selling. I think this is very possible but would only last thought the summer at the longest. The downside would be down to $2.45, if that breaks down to $2.31. It should not drop lower than that.

I guess we will see. What do all of you think about the future for copper? Here is the tweet from Chris Kimble.

 

 

 

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